Child Tax Credits

Are there tax breaks for having children?

Among all the new and exciting challenges with a new child, you may not have considered how your child will affect your taxes. No worries, it’s nothing but good news.

Even if born on the last day of the year, the IRS counts your child as having lived with you all year—so you get the full value of the tax breaks available to parents.

How much is the Child Tax Credit worth?

The Child Tax Credit increases from the American Rescue Plan Act (ARP Act) have expired. For tax year 2022, the maximum has gone back down to $2,000 for each qualifying child, and up to $1,500 is refundable if you qualify for the Additional Child Tax Credit (more info on that in the next section).

The Child Tax Credit begins phasing out for taxpayers who have modified adjusted gross income of more than $200,000 or $400,000 if married filing jointly.

What is the Additional Child Tax Credit?

The Additional Child Tax Credit (ACTC) is one poorly named tax break. The name doesn’t mean it’s a credit for an additional child; it’s an additional credit for a child. This credit is for parents who were not able to claim the full Child Tax Credit because it amounted to more than their tax liability.

The Child Tax Credit is only partially refundable for 2022, so the Additional Child Tax Credit once again fills in the gaps for qualified taxpayers. The new maximum amount for the ACTC has been increased to $1,500 per qualifying child.

What is the Credit for Other Dependents?

There is also a $500 Credit for Other Dependents, available for qualifying dependents who don’t meet all the requirements for the Child Tax Credit.

If you file with 1040.com, don’t worry about calculating whether you’ll get one credit or the other. Based on info you provide, we’ll make sure you get the credit for which you qualify.

Filing your taxes and claiming tax breaks for your family is simple with 1040.com

Keeping the filing process easy is what we’re all about—and by filing everything you need for your household for just $25, you’ll be well on your way to getting taxes done without the headache.

That’s why we’re the feel-good tax company.

If you haven’t yet, be sure to sign up or log in to get started.

Also see:
Child and Dependent Care
Claiming a Child When You’re Divorced or Separated